tv Maria Bartiromos Wall Street FOX Business September 5, 2020 10:30am-11:01am EDT
jack: those are great ideas and thank you very much. to read more, check out this week's edition at barron's.com. and don't forget to follow us on twitter@barron's online. that's all for us. see you next week on "barron's >> from the fox studios in new york city, this is maria bartiromo's "wall street." >> welcome to the program that analyzes the week that was and helps position you for the week ahead. maria's off this weekend. i'm charles payne. coming up in just a few moments, maria's one-on-one with blue apron's ceo, linda kozlowski, on the growing interest in home cooking during the pandemic, and later saul khan on remote learning. but first, another solid jobs report as the recovery from covid-19 pandemic shutdown continues. the u.s. economy added more than
1.37 million jobs in august, pretty much in line with expectations. meanwhile, the unemployment rate dropped below double digits for the first time since the shutdown, plunging to 8.4%. joining me now to discuss this and more, former jpmorgan chief economist anthony chan. anthony, thank you so much for joining us. you know, the headline number might have been in line, but you get underneath and look at some of the details in this. this is a pretty impressive report, and let's start with the unemployment rate at 8.4%. i think wall street was looking for 9.8%. >> charles, this is a great report from that perspective. i get very excited when i see unemployment rates go down. that really tells you that that's going to throw a real breath of fresh air for the american people as they see that we're making good progress on the unemployment rate. i was especially excited about the fact that the black unemployment rate dropped sharply, and so did the hispanic unemployment rate, which is something that we badly need.
the only thing that bothered me a little bit is that spread between the black unemployment rate and the national unemployment rate, that spread has been widening out just slightly over the last three months. that's been narrowing for the hispanic unemployment rate. but i believe that the federal reserve's new strategy now they're going to let the economy run hot are, in fact, take care of this issue over the next couple of years because at this point they're not even thinking about raising interest rates anytime soon, and that's going to be good for many of these groups that have suffered higher unemployment rates relative to the national population. charles: i'm going to get you back to that. i want you to zero in on that because you're the first economist that i've heard who understands, i think, or at least has articulated what jay powell is trying to do. i think he's become the world's most powerful social justice warrior. just so the audience understands, the gap between white and black unemployment that narrowed to its a small -- was its nay rowist -- narrowest
ever. black unemployment rate last month was 13%, whites 7.3%. are you thrilled about the idea that the federal reserve is saying, hey, we're not going to worry about inflations because historically with unemployment down around 4%, we would start to put speed bumps in. but that 4% doesn't reflect all parts of society. should that be the rule for the federal reserve? >> i think that is certainly encouraging, that the federal reserve is taking on this initiative. if truth be told, i think that in order to really rectify this situation, you need to see all forms of government basically joining forces. the good news for the federal reserve is that, certainly, since they started targeting inflation in january of 2012, they really haven't seen the inflation rate exceed 2% when you look at the core personal consumption deflater. so they really have a lot of head room to be able to pursue this. but we need to see all levels of government doing this. but i am encouraged. and i think it actually is going
to work, because so far jay powell has admitted himself that their estimates of the national full employment/unemployment rate has been, in fact, dry. so they really have some justification for letting the economy run hot without worrying about inflation really exceeding expectations. and right now, charles, what we have is excess capacity in the overall economy. when you consider that we have another 11 and a half million jobs that we have to make up in the establishment survey and almost 8 million jobs in the household survey used to compute the unemployment rate before we get back to -- charles: right. >> -- pre-pandemic levels, it really tells us we have a lot of excess capacity. so worrying about these things or at least addressing them is a very good idea with. charles: so you like what the fed is doing. you've mentioned twice about all hands on deck, you know, referring to the federal government. in this instance, congress.
this number, do you think it will, will it enhance the idea of perhaps another round of fiscal stimulus, or will it sort of harden these lines where republicans, a lot of republicans are saying we're moving in the right direction, let's continue to wait and see, and, of course, the other side has been nancy pelosi and company who many believe just ask for so much, it was never a genuine effort? can both sides somehow find a way to use this jobs report to speed up maybe another round of fiscal stimulus? >> charles, that was essential that both political parties get together and do something, because in the third quarter real gdp is probably going to come in somewhere around 24, 25%. and that's, of course, on the back of a lot of stimulus, on the back of the fact that consumers are getting a little bit more confident as companies are opening up and hiring more workers. but, again, just like the 25% or 28 -- yeah, 24% growth in gdp
was boost by stimulus, in the fourth quarter if you get no stimulus, you're going to start to see real gdp sort of move towards the flattest line are. so you absolutely need that stimulus. charles: right. >> now, do you need 3 or $4 trillion? probably not. but you certainly need something, otherwise gdp is going to come in at a very meager rate. and remember, or we still have a lot of workers that need jobs, so stimulus is essential, and we need both democrats and republicans to join forces. charles: right. >> otherwise the fourth quarter is going to give you a real gdp number that is close to the gnattish line, and that's -- flattish line, and that's good for anybody. charles: with one minute to go, i want to look ahead to 2021 and and say we get 1.5, 1.7 trillion in stimulus. you've got $3 trillion in saving, the stock market at record highs, home prices at record highs, you've got the wealth effect. could that actually trigger a
boom? could we see a strong 2021? >> i think that 2021 can be strong if you give it that jump, that stimulus. of course, the vaccine -- which i think is coming to a theater near us very soon -- there is no question. we can debate whether the vaccine comes before the election or after, it's coming. charles: sure, sure. >> and as long as it comes before the first quarter of next year, to 21 should not be a bad year for the economy. we know that, in fact -- charles: all right. >> -- forward earnings for the s&p have been rising, so even though i can't tell you that stocks are cheap today, actually start to see the consensus of forward earnings in the s&p 500 rising -- charles: right. >> and the federal reserve keeping interest rates at low levels, we're going to see the equity market be a better place in 2021. charles: yeah. i think the equity market and main street could have a great 2021. my thanks to you, anthony chan. don't go anywhere, maria's one own -- one-on-one with the ceo
♪ ♪ charles: welcome back. staying at home during the pandemic has forced a change of habit for many. among them, more people cooking at home as their restaurant options are limited. blue apron, they're poised to take advantage. the company sends customers meal kits to prepare their own gourmet dishes. they recently saw their first profit since going public three years ago. maria spoke with ceo linda kozlowski. >> honestly, not only are people cooking at home more, but they're saying they plan to continue to cook more at home for the foreseeable future.
everything we're seeing internally and externally says not only are people getting more confident in the kitchen, but they're really enjoying the time that they have with their family, and they're valuing that connection time with meal time. it's impacting families. spouses are also getting in on creating these dinner moments together. and so we see a much longer term impact from cooking together as we move forward. maria: so what are people doing? they want to make sure that they've got the fresh ingredients, they can cook at home, and you've actually seen that directly on the bottom line. your first profit since going public. what gives you the sense that this continues after we're out of this? >> so really what we saw in the second quarter was we is saw about a 29% growth quarter other quarter and 10% growth year-over-year, and we
anticipate the year-over-year growth will continue going forward based on the trends that we're seeing. so when we talk to our customers and also looking at third party research, it looks like, you know, at least a minimum of a third of people are thinking that they're going to continue to cook at home more not just than before the pandemic, than even during the pandemic. because of the fact that they're looking for ways to connect, they're looking for a healthier lifestyle, they're looking for fresh options, so they don't get into dinner time ruts. and so all of this feedback is coming back from our customers as they engage more whether they're new customers coming in for the first time or whether they're existing customers that are just engaging more with the service. you know, the general feeling is we're going to be at home for a while, but also we really like being able to make that at home time special and not feel like, you know, like you're sort of in a rut that actually has variety and has something different. so what we saw this past quarter is that not only did we
significantly increase our revenue volume, but that volume also we were able to bring it very efficiently considering the additional costs around managing the labor force during the coronavirus pandemic. and so we were able to see really strong margins and positive cash flow as well. which is great, because it gives us so much more flexibility going forward. maria: yeah. and you did this while also making the decision to pull back on marketing and spending on marketing while you did allocate more money to labor and to workers. tell me about that, the fact that you pulled back marketing, but you've also while pulling back marketing have come up with a new marketing partnership with, inspire by a new york chef and television personality. tell us about your marketing efforts. finish. >> sureful so, you know, in the early stages we did pull back on marketing, as did a lot of people because, frankly, there
was such strong organic demand for the product that we wanted to redirect those dollars to where it could be most useful in increasing capacity and bringing more people into, you know, into the ability to get boxes. so it was just getting more food to more people, was our top priority. at the same time, we, of course, want to keep people engaged, and we want to make sure that we're retaining a lot of the new customers that are coming in, a lot of the activity. so as we restarted our marketing, with we restarted our chef partnerships as well including most recently amanda freitag, because it's really about creating something exciting, something interesting and fun for meal time at home. and these chef partnerships really drive up engagement with our existing users and gives them a lot more variety and things to sort of have fun with when it comes to meal time. maria: and you've had new offerings, premium offerings in terms of menus. what do the menus look like today? give our audience a sense of
your offering. >> so, you know, what blue apron has always been known for is having just a really, really interesting, diverse set of ingredients and sort of culinary authority around recipes with a lot of flavor and unexpected flavors. that's one of the things people say, the fact that they can discover something new every time that they cook. and so we've always introduced new ingredients to our customers and new techniques, but with the premium offering we're going through even more unique proteins, multiple proteins in a meal, more food and really that restaurant quality experience. you can kind of have a special occasion night at home and experiment with new flavor. and so we've introduced a lot of new combinations with steak and shrimp and adding prosciutto and some other really interesting proteins, and we're starting to introduce, like duck is coming next month, in september, and we'll continue to introduce new proteins. this has actually been really,
really exciting because people can take our core menu which already has, you know, 12 choices plus the premium for 2 people and 7 choices for 4 people, and then enhance that experience, and you have those dishes for weeknight that help you prep quickly. and then also something for the weekend. it's a little bit more exciting that helps you kind of balance out so we can create that variety that people crave. charles: thanks to linda kozlowski. stay right there, maria talks online learning with khan academy owner saul khan. up next. ♪ ♪
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♪ ♪ charles: welcome back. finish back to school season underway, and while some kids are back in class, many school districts are transitioning to a hybrid learning model, a combination of online and classroom methods to start off the year. recently, maria spoke to khan academy founder saul khan to get his assessment on the back to school situation. watch. >> i think it's a really tough situation. most school districts have spent most of the last three or four months figuring out whether they could open physically or how they could open physical lu, and they haven't been able to spend too much time figuring out what does the actual instruction look like. and we're now in the reality, as you just described, where a lot of schools have have had to go at least to some form of hybrid learning or most have gone to distance learning without a lot of supports for teachers and families on what that looks like. it's really hit or miss.
a lot of schools are doing a reasonable job, but there's a lot of places where -- the issue is this isn't going to be a one or two month crisis, this is going to likely be much of this coming school year where it'll either be fully distanced or off and on between in-person and distance learning, so if we don't figure out a way to reach all kids, this could turn into a catastrophe. maria: so let's talk about that. how do you reach all kids? i mean, you founded khan academy on the notion of virtual learning, online learning. so what's the best measures that we can look at to insure that we are reaching kids, and how do you do it with best practices? >> so the tools are already out there, as you described. khan academy, it's a not for profit, mission free education for anyone anywhere. it has the practice, the feedback, especially in math and science, and we're going into other topics. it's really all about engagement at this point. what we're telling teachers and families is you can get as much
practice, feedback, learning at your own time and place on a platform like khan academy, and then as many touchpoints as you can have with teachers on video conference, the more valuable. a lot of folks don't realize there's an irony. we're doing distance learning, but for a lot of kids, their whole life is distance learning right now. that's going to be their a main connection to some form of a community. so teachers are to index on having as many touch points as possible. we have to think more flexibly instead of having one hour on zoom together with 30 kids, maybe 10 minutes at a time with 10 kids so you can get more small group type instruction. and then on top of that, we just have to provide more supports, more clear direction. i have another nonprofit project that's connecting students with tutors, volunteer tutors. and, actually, we have a surplus of tutors, so we're actually looking for students who need free, high quality tutoring. maria: i love this. and in an op-ed you wrote in
"the new york times" recently, you talked about something missing from the distance learning, the virtual learning, and that is the kids cannot have that very vital social engagement with other students that, you know, as we call the university life in college. that's not happening now. so is there a way to try to get that another way? is that what you're talking about in terms of getting small groups together? eight people on a zoom call, ten people together, is that the best we can do at this point? >> i think that's part of it. i think teachers -- phoenix is a really great example where the school district is making sure that every student in the district is getting a call from an adult. it could be a three minute phone call, but that one-on-one to say, hey, there's an adult in the system who really cares about your situation. not just academically, socially and emotionally, makes a huge difference. on top of that, if families are in a position to get together with other families in a park, that type of socialization is
really important. i've been doing it with my family in covid-safe ways. maria: what about, you know, in-school learning? we're seeing little by little and we're hoping that we see more of it, the president wants students to go back to school. teachers are pushing back. how much are we losing by having schools closed? i saw a study recently that you're talking about hundreds of millions of dollars in earnings power that students are going to get left behind because of this shutdown and the unability to go to school. inability to go to school. >> yeah. there's really two big points of damage from not being in school. one is the childcare issue. parents' productivity has a gone down dramatically. that has economic consequences. then, as you just mentioned, on the student side, predictions are kids may lose as much of a year of learning if they're not able to engage deeply in school. charles: our thanks to saul khan. don't go anywhere, more "wall street" after this. ♪ ♪
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charles: welcome back. come up next week on the show, cofounder of the carlyle group, david rubin stein, is maria's special guest. and i'll see you sunday morning on the fox news channel for "sunday morning futures." biosenator john barrasso, fox news contributor trey gowdy and author gordon chang are our special guests this weekend. catch the show at 10 a.m. eastern. plus, start smart, tune in weekdays from 6-9 a.m. eastern for "mornings with maria" right
here on the fox business network. and don't forget to join me on weekdays on fox business at 2 p.m. eastern for "making money" as we tackle all the big business news of the day. that'll do out for us, thanks for watching. we'll see you next time. ♪ ♪ ♪ ♪ gerry: welcome to the "wall street journal at large." the u.s. economy is bouncing back strockly. despite the best efforts of the lockdown enthusiasts who seem to want to keep the economy in the freezer until the election, we learned on friday that the unemployment rate dropped sharply in august to 8.4%. that means the jobless rate has fallen by almost half since most of the economy was shut down in the spring in response to the covid-19 pandemic. employers added 1.4 million jobs last month.